According to HousingWire's analysis of Mortgage Bankers Association data, proprietary reverse mortgages are experiencing a significant surge in the lending market. The MBA examined reverse mortgage originations over the past several years, comparing government-backed Home Equity Conversion Mortgages, or HECMs, with privately-offered proprietary products. What they found is pretty striking: while HECM originations grew just slightly last year, proprietary reverse mortgage originations more than doubled.
The numbers tell the story. Back in 2023, proprietary reverse mortgages represented only 7 percent of all reverse mortgage originations. By 2025, that share had jumped to 22 percent, which is more than triple where it was just two years earlier. That rapid growth comes despite HECM loans still making up the larger portion of originations in terms of sheer volume.
What's driving this shift? According to the MBA, it comes down to demographic and economic realities. More seniors are choosing to stay in their homes as they age, and decades of home price appreciation have left older Americans sitting on substantial equity in their properties. The Census Bureau data cited in the report shows that homeowners 55 and older own the majority of owner-occupied homes in the country, with those 65 and older accounting for a significant chunk of that.
Another factor worth noting is that proprietary reverse mortgages tend to come with larger loan balances compared to their HECM counterparts. This means that even though proprietary products represent 22 percent of originations by count, they actually account for nearly 40 percent of the reverse mortgage market when you measure it by dollar volume. These bigger loan sizes appeal to seniors with substantial equity looking to access meaningful amounts of cash.
What I am seeing locally here in the Bay Area and East Bay is that this trend reflects something our older homeowners have been experiencing firsthand. Many of them have watched their homes appreciate significantly over the years, and they're looking for ways to tap that wealth while staying put. As these proprietary reverse mortgage products continue to grow and evolve, I expect we'll see more conversations between seniors and their financial advisors about whether these options make sense as part of their overall housing and wealth strategy.
